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Iowa Republican senators aim to reverse a new White House plan that reduces student debt payments based on income. This plan, which enrolled 39,900 Iowans, was introduced after President Biden’s previous student loan forgiveness attempt was blocked by the Supreme Court. Both Iowa Republican Senators Chuck Grassley and Joni Ernst support a Senate resolution to overturn this proposal.
Iowa Republican Senators Oppose White House Income-Based Student Debt Plan. (Photo: Kansas Reflector)
Iowa Republican Senators Seek Reversal of Biden’s Student Loan Payment Reduction Plan Set to Launch Next Month
According to Iowa Capital Dispatch, Iowa Republican senators are actively seeking to overturn a recently introduced White House proposal that aims to reduce or cuts the student debt payments based on borrowers’ income levels.
This initiative comes in response to the U.S. Supreme Court’s decision to halt President Joe Biden’s efforts to forgive a portion of student loan debt. The SAVE program aims to lower undergraduate loan payments from 10% to 5% of borrowers’ discretionary income, considering their income and family size. It offers waivers for unpaid interest and potential forgiveness of remaining balances after a set number of payments.
Currently, more than 39,900 Iowans are in the SAVE program, with over 10,000 having their debt discharged automatically. The U.S. Department of Education estimates this could save most participants about $1,000 annually. Single borrowers earning less than $15 an hour won’t need to make payments. Over 4 million student loan borrowers nationwide have joined the program, with ongoing applications at StudentAid.gov/SAVE.
Scheduled for October 1, the plan coincides with the resumption of repayment requirements following a three-year Department of Education pause. Congressional Republicans are working to block its implementation.
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Iowa Republican Senators Critique of the SAVE Plan – Call It a “Socialism Scheme”
In an article published by Des Moines Register, Iowa Republican Senators Chuck Grassley and Joni Ernst are actively opposing the new White House proposal. Senator Grassley, during a recent press conference, criticized not only the plan but also President Biden’s broader economic approach. He argued that the plan, known as SAVE, falls short in effectively saving people money and voiced concerns about low-income Iowans struggling with rising expenses, including those at grocery stores and gas stations.
In a statement released on Tuesday, Senator Ernst described the repayment plan as a “socialism scheme” and expressed worries about its potential to worsen inflation. Both Iowa Republican Senators have presented alternative solutions to address college costs, emphasizing the crucial need for greater transparency from student debt lenders and educational institutions when offering financial aid packages.
According to the Iowa Republican Senators that their primary objective is to enhance the long-term affordability of higher education while also reinstating fiscal responsibility among federal policymakers. It’s worth noting that the Iowa Republican Senators resolution opposing the White House’s repayment plan would require majority support in both the House, where the GOP holds a majority, and the Senate, where Democrats maintain a narrow margin.
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